Description

One of the advantage in the use of debt for an enterprise is that the interests paid are tax deductible. Companies that make use of debt benefit from a tax shield that is proportionate to the corporate tax rate. This fiscal benefit reduces the overall cost of debt and this reduction must be taken into account when computing the cost of capital. To determine the size of the reduction we must use the appropriate tax rate. The coice is between the Corporate Tax Rate (marginal), that is the rate imposed by each specific country's fiscal law or the Effective Tax Rate, that is the ratio between Tax Due and Taxable Income from the last available year. The two may temporarily diverge due to deferred tax, but ultimately, the effective tax rate should converge to the marginal. Which one should you use? The marginal is more conservative: it under/overestimate the after-tax operating income in early years, but it tends to be more accurate in later years.

Plot info

Interactive choropleth chart: the plot displays the Corporate Tax Rate by country. Select a country with the cursor and a set of information will be shown. Zoom in and out using the buttons or the "Pan" functionality accessible in the top-right corner. Select an area of the map to highlight only the countries of interest. In the top-right corner you can access additional features.

Summary table

The table below displays all the data available in the plot above. You might be looking for a single data, here you can find all the relevant information for each country. The countries are in alphabetical order, use the sidebar to scroll down. Using the following link you can access an interactive pivot-table useful to run a graphical analysis or to filter data.

Where does all the data come from? Check our source